Anti- Money Laundering Law  The Basel Institute on Governance -

Singapore, Switzerland, USA, UK

"Money laundering”
(important
RA 9160 (Anti-Money Laundering Act of 2001  financial centers in cross border
[AMLA]) banking) customer due diligence
 Basel Committee on Banking
Sec. 4: Money laundering is a CRIME whereby
Supervision and Financial Action Task
the proceeds of an Unlawful activities are
Force
deposited or channeled to a bank and make
them appear to have originated from legitimate FATF – FINANCIAL ACTION TASK FORCE
sources
 Inter-governmental body
History  Established in 1989
 Based in Paris, France
 originated from Mafia ownership of
 Formed by G-7
Laundromats in the US
 with a mission of paving the way for the
 extortion, prostitution, gambling and
effective prevention and detection of
bootleg liquor.
money laundering by ensuring that
 Al Capone purchased Laundromats
appropriate measures against money
business (legitimate business)earnings
laundering are implemented in all
are mixed with illicit business
nations
 1931 Al Capone was convicted for tax
 Created and maintained a list of Non
evasion
Cooperative Countries and Territories
 Meyer Lansky (Mob’s Accountant) Uses
(NCCT List)
Swiss facilities (Loan-back concept)
 1990 - FATF issued 40
 1980’s - International level Money
Recommendations
laundering was to combat the “war on
 June 2000 – Includes Philippines in its
drugs”
list of Non-Cooperative Countries and
 1990’s –includes all serious crimes
Territories (NCCT)
involve including the abuse of power so
 October 2001 – RA No. 9160 “AMLA of
it has become a tool in the return of
2001” enacted
assets
 March 2003 – RA No. 9194 Act
 The Basel Institute on Governance -
amending RA No. 9160
Singapore, Switzerland, USA, UK
 2001 - 2008 Incorporated subsequent
(important
amendments which requires countries
 financial centers in cross border
to have measures in place to fight
banking)
financing of terrorism
 1980’s - International level Money
 Recommendation No. 8 - (Calls for the
laundering was to combat the “war on
review of adequacy of laws and
drugs”
regulations on NPOs)
 1990’s –includes all serious crimes
 Recommendation No. 9 - (Cash
involve including the abuse of power so
Couriers)
it has become a tool in the return of
assets
February 11, 2005 – FATF removed the
Philippines in the list of Non- Cooperative
Countries and Territories (NCCTs)
Three Stages of Money Laundering
Stage 1 – Placement
Involves the initial placement or introduction of
the illegal funds into the financial system.
Ex.
a. Smurfing or structuring
b. Purchase of insurance contract
Stage 2 – Layering
involves a series of financial transactions during
which the dirty money is passedthrough series
of procedures, putting layer upon layer of
persons and financial activities into the
Ex.
a. electronic transfer of funds
b. disguised transfer of funds as payment for
goods or services
Stage 3 – Integration
- the money is once again made available
to the criminal with the occupational
and geographic origin obscured or
concealed.
- The laundered funds are now integrated
back into the legitimate economy
through the purchase of properties,
businesses and other investments.
How does Money Laundering link to other
crimes?
 Directly connected to a criminal act or
illegal activity
 Predicate crimes would have already
taken place
14 Predicate crimes
 Kidnapping for ransom
 Drug Offenses
 Graft and corruption practices
 Plunder
 Robbery and extortion
 Jueteng and masiao
 Piracy on the high seas
 Qualified Theft
 Swindling
 Smuggling
 Electronic Commerce Crimes
 Hijacking, destructive arson and murder,
including those perpetrated against
non-combatant persons (terrorist acts)
 Securities Fraud
 Felonies or offenses of a similar nature
punishable under penal laws of other
countries
What is Anti-Money Laundering Act?
 Money Laundering was made a criminal
offense in the Philippines when the
Philippine Congress approved Republic
Act No. 9160, otherwise known as the
Anti-Money Laundering Act (AMLA) of
2001. It was later amended in 2003 by
Republic Act No 9194
 AMLA is the legal basis for making
money laundering a criminal offense in
the Philippines, and the money
launderer a criminal upon which
criminal penalties can be imposed
under the AMLA
  Philippines governments response to
the concerns of FATF, to hunting down
and stopping money laundering
whenever it may transpire
 ´ The Money enters the financial system
without being taxed
 ´ The money is the fruit of illegal
activity, therefore an extension of that
same crime
 Forces legitimate business to deal with
inflated, undercut transactions
 Criminal elements become more
comfortable conducting their activities
 ´ Financial system is manipulated – just
management of national economies is
put in danger
 Know Your Customer (KYC)
 Maintain strict identification standards
 Keep clear and accurate records
 Report all covered and suspicious
transactions
International agency that fights money
laundering:
 Financial Action Task Force
(FATF)
 The Egmont Group
 The Asia Pacific Group on
Money Laundering
´ BSP
´ Banks, off shore banking unit, quasi-bank, trust
entities, non-stock savings and loan
associations, including their subsidiaries and
affiliates, as well as pawnshops, foreign
exchangers and remittance agents
´ SEC
Securities dealers, brokers, pre-need companies,
foreign exchange corporations, investment
houses, trading advisors and all other entities
dealing in currency, commodities or other
monetary properties
´ IC
´Insurance companies, insurance agents,
insurance brokers, professional reinsurers,
reinsurance brokers and holding companies
What is a covered transaction?
 A single transaction involving a total
amount in excess of PHP500,000.00
within 1 banking day with a covered
institution (cash)
 This must be reported to the AMLC in a
covered transaction report (CTR)
 For the AMLC To check these
are legitimate transactions
What is a suspicious transaction?
1. No underlying legal or trade reason or
purpose for the transaction – large transaction
for no apparent reasons
2.The individual making the transaction has no
proper identification
3.The amount involved does not correspond
with the expected business or financial capacity
of the individual making the transaction
4.The transaction is done in a way to avoid being
reported as a covered transaction to the AMLC
– big transaction broken into smaller ones in the
same day
5. The transaction is a major shift from the usual
transaction history of the individual
6.The transaction is in any way related to an
unlawfully activity or money laundering offense
– must be reported immediately
7.Any transaction that is similar or analogous to
the foregoing
A suspicious transaction report (STR) should be
made if any of these conditions are met.
Importance behind fighting money laundering
Other violations punishable under the AMLA:
 Serious problem
 Criminals will multiply if even small
businesses does not comply
 Small businesses may be held
responsible under AMLA
 Global scale and is not limited to local
context
 For the law to prevail here and abroad
must work hand in hand
How to fight
 Know Your Customer (KYC)
 Maintain strict identification standards
ANTI-MONEY LAUNDERING COUNCIL
 Keep clear and accurate records
 Report all covered and suspicious
transactions
International agency that fights money
laundering:
 Financial Action Task Force
(FATF)
 The Egmont Group
 The Asia Pacific Group on
Money Laundering
Legal Consequences –penalties and its related
offenses
The AMLA penalizes the following acts or
omissions:
´Money laundering proper – 7 to 14 years
imprisonment and fine not <3M but not more
than twice the value of money instrument or
property
 Facilitating money laundering – 4 to 7
years and fine not <1.5M but not > 3M
 Failing to report CTR and STR – 6
months to 4 years or a fine not <100K
but not >500K or both
 Failure to keep records – 6months to 1
yr or a fine not <100K but not >500K or
both
 Malicious reporting - 6 months to 4
years and a fine not <100K but not
>500K or both
 Breach of confidentiality – 3 to 8 yrs and
a fine not <500K but not>1M
 Administrative violations – fine 100K to
500K
 2001 ALMC was formed upon the
enactment of RA 9160
 with a mandate to prevent the entry of
illegally acquired funds into our
financial system
 AMLC Secretariat implementing arm of
AMLC
FUNCTIONS OF AMLC
1. to require and receive covered or
suspicious transaction reports from
covered institutions;
2. issue orders to determine the true
identity of the owner of any monetary
instrument or property that is the
subject of a report, and to request the
assistance to the approve a
foreign country if
3. institute civil forfeiture and all other
remedial proceedings through the
Office of the Solicitor General;
 4. to cause the filing of complaints with
the Department of Justice or the
Ombudsman for the prosecution of
money laundering offenses;
5. to investigate suspicious transactions
and covered transactions deemed
suspicious after an investigation by
AMLC, money laundering activities, and
other violations of the Act;
6. Secure the order of the Court of
Appeals to freeze any monetary
instrument or property alleged to be
the proceeds of unlawful activity
7. Implement necessary and justified
measures to counteract money
laundering;
8. Receive and act on any requests from
foreign countries for assistance in their
own anti-money laundering operations
9. Develop education programs to make
the public aware of the pernicious
effects of money laundering and how
they can participate in bringing
offenders to justice
10. Enlist the assistance of any branch of
government, including intelligence
agencies, for the prevention, detection
and investigation of money laundering
offenses and prosecution of offenders
11. to impose administrative
sanctions for the violation of laws, rules,
regulations and orders and resolutions
issued pursuant thereto; and
 Republic Act No. 10365 - Further
Strengthening the AMLA
 Republic Act No. 10927 - Designating
Casinos as Covered Persons under the
AMLA
 2016 Revised Implementing Rules and
Regulations of Republic Act No. 9160,
As Amended (2016 RIRR)
 Casino Implementing Rules and
Regulations of Republic Act No. 10927
(CIRR)
 Rules on the Imposition of
Administrative Sanction under Republic
Act No. 9160, as Amended
 A.M. No. 05-11-04-SC - Rule of
Procedure in Cases of Civil Forfeiture,
Asset Preservation, and Freezing of
Monetary Instrument, Property, or
Proceeds Representing, Involving, or
Relating to an Unlawful Activity or
Money Laundering Offense under
Republic Act No. 9160, as Amended.
 Republic Act No. 10168 - Terrorism
Financing Prevention and Suppression
Act of 2012
 Implementing Rules and Regulations of
Republic Act No. 10168

Laws and Rules Covering the AMLC

 Republic Act No. 9160 - Anti-Money

Laundering Act (AMLA) of 2001

 Republic Act No. 9194 - Amending the

AMLA

 Republic Act No. 10167 - Strengthening

the AMLA